Organizational Psychology (PSY510)
According to the Oxford dictionary, the word ethics stands for set of moral philosophies or principles.
Simply put, ethics is the right and the wrong of behaviour in organizations.
The word morality and ethics are interchangeable. The presence of two words in the English language with
the same meaning is due to the fact that they derive from different roots; morality, from the Latin word
moralitas, and ethic, from the Greek ethikos. There is no difference, therefore, between describing
discrimination as a moral issue and as an ethical issue.
Ethics, along with logic, epistemology, and metaphysics, is a traditional area of philosophical inquiry that
dates back to the time of the ancient Greeks. This study is either descriptive or normative.
Descriptive ethics may involve an empirical inquiry into the actual rules or standards of a particular group,
or it could include the understanding the ethical reasoning process. On the other hand, the normative ethics
is concerned not with what people believe we ought to do but with what we really ought to do and is
determined by reasoning or moral argument.
Ethics is a body of principles or standards of human conduct that govern the behavior of individuals and
groups. Ethics arise not simply from man's creation but from human nature itself making it a natural body
of laws from which man's laws follow.
The principles of ethical reasoning are useful tools for sorting out the good and bad components within
complex human interactions. For this reason the study of ethics has been at the heart of intellectual
thought since the early Greek philosophers, and its ongoing contribution to the advancement of knowledge
and science makes ethics a relevant, if not vital, aspect of management theory. Ethical principles continue,
even today, to have a profound influence on many modern management fields including quality
management, human resource management, culture management, change management, risk management,
mergers, marketing, and corporate responsibility.
Ethics is much more than just a collection of values. Values are almost always oversimplifications, which
rarely can be applied uniformly. Values tend to be under-defined, situational by nature and subject to
flawed human reasoning such that by themselves they cannot assure true ethical conduct. Consider the
sought after value of employee loyalty. Should employees be loyal to co-workers, supervisors, customers, or
investors? Since it may be impossible to be absolutely loyal to all four simultaneously, in what order should
these loyalties occur? Employers that demand employee loyalty rarely can answer this question completely.
Regarding the inadequacy of values, consider this. Murderers, criminals, and liars all have values, so does
this make them ethical? Also, killing can be either unethical or ethical (such as in self defense) depending
on the situation (religious arguments aside for the moment). For these reasons and more, values by
themselves are generally insufficient measures of ethics.
Impact of Ethical Practices On Organizational Behavior
Ethics is influenced by cultural, organizational and personal factors. Poor ethics can be extremely damaging
to organizational performance. When ethical behavior is poor it taxes operational performance in many
visible and sometimes invisible ways. The tax can be on yield or productivity, which is easily measured. The
tax can impose itself on group dynamics, suppressing openness and communication, which is hard to
measure but easily felt. Perhaps the most dangerous tax is the one placed on risk, which is neither
measurable nor easily sensed. Whether the damage is visible or invisible, poor ethics blinds the organization
to the realities of their declining environment leaving any organization vulnerable to setbacks that could be
Good ethics on the other hand have a surprisingly positive effect on organizational activities and results.
Productivity improves. Group dynamics and communication improve, and risk is reduced. One reason for
this is ethics becomes an additional form of logical reasoning, increasing the flow of information, and
adding an additional set of eyes and antennae to give the organization needed feedback regarding how it is
doing. Increased reasoning capabilities, coupled with additional information, is a strategic advantage in any
business or organization.
Real organizational ethics is a rational process for exploring decision and behavior alternatives and selecting
the best possible choices for all involved. Real ethics, at the organizational level, goes beyond personal
ethics and values. Real ethics is a collective undertaking, or a team sport, with team like demands and
Organizational Psychology (PSY510)
results. Ethical issues in organizations can get complicated very quickly, so much that even the best trained
ethicists often will not know what decisions to make or what ought to be done. Such times are precisely
when the disciplined reasoning of ethics quality pays off the most. Ethical decisions and their corresponding
behaviors in organizational settings are never perfect. However, the quality of the processes applied, as well
as the usefulness of their outcomes, is precise and measurable with scientific certainty. It is through the
process of ethical reasoning that bad things are preventable and great things become more possible.
Organizations need ethics quality not only to prevent unhealthy behavior but to inspire superior reasoning
and performance. It is only through human nature, and ethics, that we can inspire greater levels of
innovation, teamwork, and process breakthroughs that result in sustainable competitive advantages. Oliver
Wendell Holms wrote, "Once a person's mind is expanded by a new idea the mind can never return to its
original form." The same is true with management and ethics. When managers understand how ethics
makes them better, their role as a manager changes forever. Once ethics is learned we all acquire the ability
to see what we often could not see before. We see that using ethics - the reasoning science - to improve
individual and group performance is what real ethics -and real management- are all about.
Improper sexual conduct in the workplace--which includes lewd and suggestive comments, touching and
fondling, persistent attention, and requests for sexual favours--has long been a problem for women, and
occasionally for men. All too often, such sexual harassment has been regarded as employers as a personal
matter beyond their control or as an unavoidable part of male-female relations. However, increased
attentions to the problem and recent developments in laws have made employers aware of their
responsibilities--and women, of their rights! Three fourth of working women in the States are subjected to
sexual harassment. Laws are passed in various countries whereby sexual harassment is properly defined and
punished if found in the workplace. A number of steps are taken by organizations to discourage employees
form sexual harassment.
Surveys of employee attitudes reveal substantial agreement on some of the activities that constitute sexual
harassment and differences on others. In particular, most of the respondents in a 1980 poll conducted by
Harvard Business Review and Redbook magazine consistently rated a supervisor's behaviour as more
serious that the same action by a co-worker, thereby recognizing the sexual harassment is mainly an issue of
Although sexual harassment is usually committed by one employee against another, employers bear both
legal and ethical obligation to prevent harassment and to act decisively when it occurs. Harassment is more
likely to occur when management has not prescribed clear policies and procedures with regard to conduct
of a sexual nature. Employers who display an insufficient concern or have inadequate procedures for
detecting harassment in the workplace bear some responsibility for individuals' harassing conduct. In
addition, companies cannot fully evade responsibility by blaming the victim for not reporting sexual
harassment in accord with the established procedures. The way in which employers respond to claims of
sexual harassment sends a powerful message about the seriousness with which management takes in own
policies and procedures. The legal duty of an employer also extends to harassment by non-employees such
as customers and clients.
Most corporations have recognized the cost of sexual harassment and accepted the responsibility to prevent
it by establishing programs to deal with sexual harassment on the job. The major features of these programs
1. Developing a firm policy against harassment
2. Communicating this policy to all employees and providing training, where necessary, to secure
3. Setting up a procedure for reporting violations and investigating all complaints thoroughly and
4. Taking appropriate action against the offenders.
Pay and Promotion Discrimination
The term discrimination describes a large number of wrongful acts in employment, housing, education,
medical care, and other important areas of public life. Although discrimination in each of these areas takes
different forms, what they have in common is that person is deprived of some benefit or opportunity
because of membership in some group toward which there is substantial prejudice. Discrimination in
employment, which is our concern here, generally arises from the decisions employers make about hiring,
Organizational Psychology (PSY510)
promotion, pay, fringe benefits, and the other terms and conditions of employment that directly affect the
economic interest of employees.
Research shows that women get 60% of men's pay all over the world which particularly women doctors and
lawyers get 75% of men's pays.
Another form of discrimination that relates to promotion opportunities in job is referred to as the Glass
Ceiling effect where women or other minority groups are not allowed promotion beyond a certain level in
the organization. However, Glass ceiling effect can be removed by:
· Warm rather than luke warm management policies: which means that the management needs to
stringently enforce non-discriminatory policies in the organization.
· Gender training
· Seeding strategy: directly placing women in senior position
Early in the century, the Ford Motor Company set up a "Sociological Department" in order to make sure
that workers in Henry Ford's words, were leading "clean, sober, and industrious" lives. Company inspectors
checked bank accounts to keep Ford employees from squandering their munificent $5-a-day wages. They
visited employees living quarters to see that they were neat and healthful, and they interviewed wives and
acquaintances about the handling of finances, church attendance, daily diet, drinking habits, and a host of
the other matters. Workers who failed to live up to Henry Ford's standards of personal conduct were
Government is not the only collector of information. Great amounts of data are required by corporations
for the hiring and placement of workers, for the evaluation of their performance, and for the administration
of fringe benefit packages including health insurance and pensions. Private employers also need to compile
personal information about race, sex, age, and handicap status in order to document compliance with the
laws on discrimination.
Computer technology, drug test policy and efforts to control lifestyles of employees have created employees
privacy issues. Monitoring the work of employees is an essential part of the supervisory role of
management, and new technologies enable employers to watch more closely than ever before, especially
when the work is done on telephones or computer terminals. Supervisors can eavesdrop on the telephone
conversations or employees, for example, and call up on their own screens the input and output that appear
on the terminals of the operators. A computer record can be made of the number of telephone calls, their
duration, and their destination. The number of keystrokes made by a data processor, the number of errors
and corrections made, and the amount of time spent away from the desk can also be recorded for use by
Without question, the technologies that threaten privacy have brought us many benefits. Finding the right
means is a great challenge to business firms which must meet employee and consumer expectations as they
utilize new technologies. More than many business ethics problems, protecting privacy require a
coordinated solution involving many parties. Until a solution is found, though, the focus of businesses will
remain on developing and implementing privacy policies.
Because the study of organizational ethics is in its infancy compared to other areas of healthcare ethics,
discussions about it often seem like hot air with no palpable payoff.
· Boatright, R., John. (2003). Ethics and Conduct of Business (Fourth Edition). India: Taj Press.
· EJBO is Journal of Business Ethics and Organization Studies published by the Business and
Organization Ethics Network (BON) in School of Business, http://ejbo.jyu.fi/index.cgi?page=cover
· Shawn C. Helms, "Translating Privacy Values with Technology," Boston University Journal of Science
and Technology Law, 7 (2001), 156.
· These camps were described and analyzed in Karl D. Belgum, "Who Leads at Half-time? Three
Conflicting Views on Internet Privacy," Richmond Journal of Law &Technology, 6 (1999),
· Aristotle. The Nicomachean Ethics, Welldon, J. trans. Prometheus Books (Buffalo, NY: 1987).
Organizational Psychology (PSY510)
Bentham, J. Introduction to the Principles of Morals and Legislation in Warnock, M ed. Utilitarianism,
On Liberty, Essay on Bentham: together with selected writings of Jeremy Bentham and John Austin,
Meridian/New American Library (New York, NY: 1974).
· Rawls, J. A Theory of Justice, The Belknap Press of Harvard University Press (Cambridge, MA: 1971).
· Sartre, J. Existentialism and Humanism, Mairet, P. Trans. & Intro. Eyre Methuen Ltd. (London, UK:
· Vanderbos, G..Knapp, S., & Doe, j. (2001 March 7). U.S. Cracks International Software Piracy Ring:
· Miller, Kevin. (2005 January 28). Professors have expressed the most concern about privacy rights
regarding intellectual property and personal e-mails from students. Retrieved March 7, 2006, from
· Spring, Tom. (2000 December 26). Copy Controls: Fair Use or Foul Play? Retrieved March 7, 2006,
· Inter Property Law Associates. (2005 October 15). Property Law and Issues. Retrieved March 8, 2006
Bergman, P.G., (1999 December 10). Out-Licensing Brings Schools Profits, Big Legal Bills", The
National Law Journal. Retrieved March 6, 2006 from
· Rohde, Laura, (2000 December 15). "BT [British Telecom] Sues Prodigy over US Hyperlink Patent",
Retrieved March 13, 2006 from
· Buchholz, Daniel, (1996 May 02). An interesting Trademark case in Cleveland OH. Retrieved March 13,
· Bergman, P.G. & Editors of Encyclopeida Britannica Online. (2005-2006). Trade Secret. Encyclopedia
Britannica Online. Retrieved March 13, 2006. from Encyclopedia Britannica Online on the World Wide
· Coulter, Mary. (2004). Trade Secret & Protection by Law. Hove England: Denver Press.
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